Vietnam Transport ministry to restructure five large corporations

The Ministry of Transport of Vitenam will submit plans to restructure five large corporations under its management to the Prime Minister for approval to ensure the effective operations of these concerns.

The five are Vietnam Railway Corporation (VRC), Vietnam National Shipping Lines (Vinalines), Shipbuilding Industry Corporation (SBIC), Vietnam Expressway Corporation (VEC), and Cuu Long Corporation for Investment Development and Project Management of Infrastructure (Cuu Long CIPM).

As for VRC, the ministry has plans to merge Saigon Railway Transport JSC and Hanoi Railway Transport JSC into a single concern.

However, certain divisions will be separated from the consolidated firm, including employees, capital and assets, to set up a joint stock company trading in rail freight transport. When the company operates smoothly, all the State capital at this company will be divested while State ownership at VRC will be reduced to 51%.

Regarding Vinalines, the Ministry of Transport has submitted the PM an equitization plan for the corporation. To cut losses, Vinalines is told to combine with other large groups such as Vietnam National Coal and Mineral Industries Group (Vinacomin), Vietnam Oil and Gas Group (PVN), Hoa Phat Steel JSC and Vissai Ninh Binh to secure enough goods for transport.

Vinalines will also have to liquidate old vessels that no longer operate effectively. The corporation last year managed to sell six 125,000-ton aging vessels, and its current fleet still comprises 91 ships with a combined tonnage of over 1.8 million tons.

It will hold 65% of chartered capital in three key ports, namely Haiphong, Danang and Saigon, and will maintain its ownership of 49% at Khuyen Luong Port JSC and 51% at Nghe Tinh and Can Tho Port JSCs.

As of 2017, Vinalines has divested State capital from 39 enterprises, including complete divestment from 31 enterprises, fetching VND2.4 trillion (US$105.6 million), and earning profit of VND360 billion.

The corporation also settled nearly VND6.6 trillion in debts including over VND1 trillion of principal at the Vietnam Development Bank (VDB) and paid debts totaling VND5.6 trillion. As of 2017, Vinalines still owes VND14.7 trillion.